Response to article by Alan Wood about Lyttelton Port takeover

Published 24 September 2014

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Chairman of the Takeovers Panel, David Jones, responds to Stuff Business Day article of 20 September 2014 “Port takeover highlights confusion on valuations”.

Mr Jones said “the Panel recently considered the concerns expressed by the New Zealand Shareholders Association about the completeness of the Northington Partners independent report in regard to the takeover of Lyttelton Port Company”. Following the approaches from NZSA to the Panel, the directors of Lyttelton Port posted an announcement on the NZX on 12 September to clarify for shareholders the difference between the company's reported net asset figure and the Northington valuation information that some had found to be confusing.

Mr Jones said “this is not the first occasion when the methodology used or conclusions reached by an independent adviser in its report have been criticised as being misleading, and referred to the Takeovers Panel. The Panel takes the view that the opinions expressed are those of the independent adviser and it is not appropriate for the Panel to substitute its views for those of the adviser. However, where the Panel considers that an opinion is misleading it will require the matter to be addressed. In considering whether a statement of opinion is misleading, the Panel applies the relevant common law for misleading or deceptive conduct: Was the opinion honestly held by the adviser? Was the opinion reasonably based? Was the opinion demonstrably wrong?”

The Panel considered the concerns that had been raised about Northington Partners’ report for the Lyttelton Port takeover, and on the basis of these legal tests reached the view that Northington Partners’ opinion was not misleading and did not breach the Takeovers Code".